I must admit this is the first time that I decided to delve into the management style of a national country leader. During the last American election I was quite impressed by the way that Obama fought the election on several fronts, including his great oratory skills, defeating Hillary Clinton, using social media and the Internet to raise funds for his campaign, his views on America’s role in the world and Health care to name a few. Now that we are approx. half way through his Presidency, I wanted to find out whether there was a consensus on his Presidency, i.e was he perceived to be good, bad or indeed great. I personally thought that he could go down in the annals of history as not only the first Black President of America but as one of the greatest.

As always, my personal view is that he needs to communicate to the American public his strategy in more detail, coupled with his intentions for the future, along with his successes. For a President who successfully helped solve the American car crisis and introduced America’s first ever Health legislation, he certainly doesn’t seem to be communicating that to the public effectively enough (Maybe he needs to blow his trumpet on his small and large successes to date). He seems to forget that his stakeholders’ are the public and that he needs to communicate with them the reasons why he is the best candidate to secure America’s future prospects.

My writing style had to change as I was not just analysing a sitting President but was also writing about the management style of a manager who is managing an economy and not just an organisation. In comparison terms, that is akin to comparing, well, therein lies the problem, one cannot compare any organisation to a huge country such as USA. This is a country and it is managed by a bond between both the public and private sector.

Frank Burke, American Thinker said, “The President’s inner circle has, for the most part, consisted of Chicago machine politicians. The appointment of numerous Czars, whose functions are neither well-articulated nor understood, has led to confusion on all levels and among the public”.

This seems to be a view shared by David Brooks, NY Times, “Obama has been a delegator and a convener. He sets the agenda, sketches broad policy outlines and then summons some Congressional chairmen to dominate the substance. This has been the approach with the stimulus package, the health care law, the Waxman-Markey energy bill, the Dodd-Frank financial reform bill and, so far, the Biden commission on the budget.

As president, Obama has proved to be a very good Senate majority leader — convening committees to do the work and intervening at the end.

All his life, Obama has worked in non-hierarchical institutions — community groups, universities, legislatures — so maybe it is natural that he has a non-hierarchical style. He tends to see issues from several vantage points at once, so maybe it is natural that he favours a process that involves negotiating and fudging between different points of view.

Still, I would never have predicted he would be this sort of leader. I thought he would get into trouble via excessive self-confidence. Obama’s actual governing style emphasizes delegation and occasional passivity. Being led by Barack Obama is like being trumpeted into battle by Miles Davis. He makes you want to sit down and discern.

But this is who Obama is, and he’s not going to change, no matter how many liberals plead for him to start acting like Howard Dean”.

This comment from Larry Summers, former Treasury Secretary and former adviser to President Obama provides a unique insight into his management style (Courtesy of Dave Schuler, The Glittering Eye),”If you wrote Barack Obama a memo before the meeting, it is a virtual certainty that he will have read it. If you seek to explain the memo you wrote to him during the meeting, he will cut you off, and he will be irritated. If he, as the leader of the meeting, will ask one or two questions to kick the tires, but will basically focus on how whatever subject you’re talking about fits with the broad vision and approaches of his presidency.

He will basically take the attitude if you’re his financial advisor, that if you can’t — it’s up to you to figure out whether preferred stock or subordinated debt is the appropriate financial instrument for your bailout, and that if he doesn’t trust you to figure it out, he’ll get a new financial adviser, but that is not the question on which he is going to spend time”.

Obviously, every President has faced their fair share of exceptional challenges, highlighted again, the need for direct communication as Lurita Doan, Townhall said, “Obama exhibited colossal managerial negligence in refusing to communicate directly with BP leadership for almost two months. Then, when this negligence was publicized, Obama opened communications and extorted the arbitrary sum of $20 billion dollars to cover liabilities. Twenty billion dollars, without full knowledge of all the facts, without the benefit of a full investigation of the causes and without a final solution for the problem, under the control of one of Obama’s Czars just looks like a slush fund”.

NEIL KING JR. and JONATHAN WEISMAN, Wall Street Journal explains further in great detail how Obama, conducts his office and provides further details into his unique management style, “In a White House ritual new with this administration, the president gathers with his advisers every weekday morning for an Oval Office update and debate on the economy. The breadth of topics is wide, from the underemployed to childhood obesity, and Mr. Obama often dives into the minutiae.

In the sessions, according to those who attend, the president sometimes chafes at his advisers’ limitations, quizzing them on points raised by critics or asking them to do justice to a view other than their own. At times he quotes from letters sent to the White House to counter a stance taken by his team.

A president’s management style can set the tone for an administration. Jimmy Carter was a famed micromanager, often at odds with his own advisers, and he caught a lot of Beltway criticism for his focus on policy details. “If the two risks are operating at too generalized a level or micromanaging, you need to find a balance between the two,” says Peter Orszag, the White House budget director.

In early July, the president ordered a briefing on derivatives — financial contracts that track the return on stocks, bonds, currencies or other benchmarks. Critics had been raising questions about administration proposals to regulate certain derivatives, such as credit-default swaps, which many blame in part for the financial crisis. With advisers gathered round on the Oval Office’s twin sofas, Mr. Obama said he was concerned that the administration hadn’t struck the right balance.

Its proposal called for standard derivatives to be traded on an exchange, bringing them into the open. Critics were calling the proposal too timid because it also would allow “customized” derivatives to continue trading privately. “What is to assure that this won’t drive all derivatives off the exchange?” the president asked, according to Mr. Emanuel.

He says Mr. Obama was frustrated his team wasn’t offering up a full range of views on how to approach derivatives regulation. “Get me some other people’s opinions on this,” Mr. Emanuel recalls the president as saying. “I want more than what’s in this room.”

On July 1, advisers gave Mr. Obama a briefing on “House Prices, Consumer Debt and Consumption.” Among their charts was one showing how homeowners during the boom used the rising value of their houses to borrow more against them. At the end, the president pushed the presentation aside. “Guys, this is great research,” he said, according to Mr. Emanuel. “But you’re telling me that people have been using their houses as ATMs. I could have told you that.”

Letters from constituents appear to play a role in shaping the president’s thinking. Each day, the White House staff combs through mounds of letters and picks 10 for Mr. Obama to read. In May, one from a woman in Georgia caught his eye. She said she had asked a bank to refinance her house, under the administration’s plan to help struggling homeowners, but had been turned down. She mentioned that her “loan-to-value” ratio wasn’t excessive — her mortgage was for no more than 80% of the house’s value.

Mr. Obama scrawled in the margin “Is this how the ratio is supposed to be calculated?” and sent the letter to one of his economists, Mr. Goolsbee, according to a White House adviser”.

The stark contrast between managing organisation’s is made clearer by Steven Cohen, Huffington Post, “Obama relies on a combination of his own intellect, a small circle of trusted advisers and a larger group of outside experts.

Ronald Reagan began the process of deconstructing the federal government’s capacity. This effort to “starve the beast” and destroy federal capacity was reversed during the Clinton era as Vice President Gore led a well-intentioned effort to reinvent government, but the forces of disintegration picked up renewed momentum during the Bush years of 2001-2009. During the Presidency of Bush the latter, federal agencies that needed to build capacity for a new task were required to demonstrate that the capacity could not be found and purchased in the private sector. The underlying assumption of federal management during the Bush Presidency was that government was the enemy and the private sector was the great repository of management competence in America.

The “make or buy decision” requires that every well managed organization constantly ask itself: “Should we do this in-house or should we outsource?” That is a question that should be addressed pragmatically: “what would work best?” Management in the U.S. federal government has the answer provided for them: buying from the private sector is better than making it in the government. In an article I wrote in Public Administration Review in 2001, I argued for what I called “functional matching.” I wrote that some tasks are best performed by government (especially policing), some by non-profits (for example mission-driven health and social welfare programs) and some by private firms (customer driven services and manufacturing).

At the local level, government services are visible and have an immediate impact. While ideology plays a role locally, it doesn’t usually dominate. In New York, the debate over charter schools has an ideological component, but the visibility of education performance measures provides evidence that moves the argument beyond ideology. Local officials are instantly accountable if water is not delivered, waste is not removed, fires are not put out and criminals are not apprehended. In New York City, most social services are now delivered by non-profit organizations under contract to the city’s government. No one thinks about this practice as an ideological privatization strategy. It’s simply the best way to help people in need. As a result of constant pressure to do more with less over the past three decades, New York City government has improved its performance and capacity.

In Washington D.C., symbolism and ideology drive agency management and performance takes a back seat. The story at the federal level is characterized by management incompetence. We have seen it in the Department of Interior during the Gulf oil spill, during the horror show of FEMA during Katrina, and when we analyze the overuse of contractors by an overly-small military presence during the War in Iraq. The lack of concern for capacity and management excellence has driven superb civil servants out of public service, destroyed organizational capability and made it impossible for the government to keep up with a more complicated and technologically based economy. The result has been the type of government performance we have seen in the Gulf of Mexico”.

His desire to formulate effective teams and to achieve the best for his country is highlighted by the article, Inside the Presidents club by NANCY GIBBS; MICHAEL DUFFY (Some excerpts), “There is no conversation so sweet as that of former political enemies,” Harry Truman once observed, and the modern Presidents are living proof. By the time Clinton made peace with Obama, he was also so close to the entire Bush family–vacationing with the father, raising money with the son, even escorting Barbara at Betty Ford’s funeral–that the Texas clan had bestowed a nickname: Brother from Another Mother.

Now in an age of global celebrity, when Presidents live longer and larger than ever, they retain unmatched influence long after they leave office. Plus they’re the only ones who know what the job does to a person.

They called him after he won. “They were all incredibly gracious,” Obama said. “But I think all of them recognized that there’s a certain loneliness to the job … Ultimately, you’re the person who’s going to be making decisions … You can already feel that fact.” He wanted his club initiation to include the entire membership, so he asked Bush to host a luncheon for all four living Presidents in early January. This request caused the Bush White House to gulp hard: Even Carter? aides asked. He has criticized everything we have done for nearly eight years. Yes, Obama said, Carter too”.

I have been reading the Time magazine since a very early age and wanted to conclude with observations from one of the greatest writers for Time (in my opinion), Fareed Zakaria and his article, The Strategist, “In the central battle in the war on terrorism, Obama adopted many of the Bush Administration’s aggressive tactics, used them more aggressively and achieved greater success. Republicans find it difficult to attack Obama credibly on the core issue of fighting America’s enemies because he outflanked them on the right.

When asked to describe the Obama Doctrine, the President has chosen not to respond directly, but he explained that he believes the U.S. must act with other countries. “[Mine is] an American leadership that recognizes the rise of countries like China, India and Brazil. It’s a U.S. leadership that recognizes our limits in terms of resources and capacity,” he told TIME.

A great deal of foreign policy is crisis management. “Stuff happens,” the President said, “and you have to respond.”

The strategy of “rebalancing” might well be the centrepiece of Obama’s foreign policy and what historians will point to when searching for an Obama Doctrine. It is premised on a simple, powerful recognition. The center of global economic power is shifting east. In 10 years, three of the world’s five largest economies will be in Asia: China, Japan and India. The greatest political tensions and struggles might also be in Asia as these countries seek political, cultural and military power as well. If the U.S. is going to be the central global power, it will need to be a Pacific power.

In a speech to the Australian parliament, Obama signaled America’s intent. “The United States is a Pacific power, and we are here to stay,” he said.

Good foreign policy Presidents (like Dwight Eisenhower and George H.W. Bush) managed a complex set of challenges expertly, making few costly errors. Bad ones (like George W. Bush and Lyndon Johnson) made mistakes that cost America in lives, treasure and prestige. But great foreign policy Presidents (like Harry Truman) created enduring structures and relationships that produced lasting peace and prosperity. Obama has been a good foreign policy President; he has the opportunity to become a great one”.

UPDATED: 08/10/11 – This post is dedicated to one of my heroes and role models, Steve Jobs, 1955-2011, Thanks for the inspiration. May God bless you.

In February 2010, I posted the blogpost – Steve Jobs (CEO Apple) management style and CIOs that is currently my most successful blogpost. This post attracts so many people that the search, ‘apple management style’ will return this article as the number one post. That’s without any adwords!

With the arrival of Tim Cook as Apple’s new CEO, a lot has been written comparing the two. I actually debated about writing an article on Tim Cook’s management style as well and spent the last two week’s debating the direction to take. In the end, I decided that it would be best for me to re post the original blogpost in its entirety. That decision was made because so much has been written about Tim Cook (both in the past and currently) that it would be better to leave all my readers with some appropriate links to get an idea of Tim Cook’s management style.

The most interesting part from my point of view was that I found older articles, in many cases, better than the current articles as they were quite speculative and gave solid reasons for why Tim Cook should be chosen as Apple’s next CEO. In contrast, the current articles do not have to speculate anymore and as such just wrote about Apple’s new CEO supported by content mostly from a few years ago. Anyway, below is the full text of my previous blogpost (Just after the links), Steve Jobs (CEO Apple) management style and CIOs:

This article is an article in a series of articles where I will analyse current and past leaders to ascertain how Chief Information Officer’s (CIOs) can learn better management by applying the management practices of leadership, practiced by these leaders. I have broken down Steve Job’s style into two distinct pieces. The management style and the presentation style.

PS: CIO is a generic term and other analogous titles are Head of IT, IT Director, Director of IT etc.

The Management Style

In an interview with Fortune, Steve Job’s (SJ) opened up about his management Style (In no particular order and a few other sources utilised):

2. Spotting opportunities:SJ – “We all had cellphones. We just hated them, they were so awful to use.”

The lesson that can be learnt is that within IT we need to spot opportunities for improvement. It is not enough, however, just to spot them, the onus is to spot them and then to create an environment to leverage that opportunity and to make it happen.

3. Improve productivity:– SJ – “We figure out what we want. So you can’t go out and ask people, you know, what the next big [thing.] There’s a great quote by Henry Ford, right? He said, ‘If I’d have asked my customers what they wanted, they would have told me “A faster horse.”

As a CIO, we need to ask ourselves, what can we do that will improve our customers or our own productivity? That could entail listening to your customers, horizon scanning or simply taking action on something that you feel would help you, your team/and/or customers.

Sometimes it’s best to follow your instincts and to believe in yourself to do the right thing. Paralysis by analysis is often the cause that many organisations cannot do well. It’s as Nike says, Just do it!

5. Competitive advantage: SJ – “It is the intimate interaction between the operating system and the hardware that allows us to do that. That allows us to innovate at a much faster rate than if we had to wait for Microsoft, like Dell and HP and everybody else does.”

CIOs need to ask themselves how they can help the business through leveraging IT to create competitive advantage? I covered this a few weeks ago, in my post, Leveraging IT for Competitive Advantage – Myth or Reality?. Sometimes, it makes sense not to embrace open platforms, as Apple has created a significant competitive advantage, by keeping it’s hardware/software systems closed. CIOs need to make such decisions cautiously.

6. Succession planning and his reputation:SJ – “My job is to make the whole executive team good enough to be successors, so that’s what I try to do. My job is to not be easy on people. My job is to make them better. My job is to pull things together from different parts of the company and clear the ways and get the resources for the key projects.”

CIOs need to be facilitators and to bring people together working towards a common goal. It is also important to have succession planning in order that the business has continuity in the unfortunate event of a CIO not being able to provide management.

7.Focus: SJ – “People think focus means saying yes to the thing you’ve got to focus on. But that’s not what it means at all. It means saying no to the hundred other good ideas that there are. You have to pick carefully.”

A CIO needs to focus on the most important issues that are relevant to the business and to shy away from the issues/projects that do not add value to the business but may just be a ‘nice have’ or appear to add value. Learn to say, ‘No’.

8. Talent acquisition: “They have to be really smart. But the real issue for me is, Are they going to fall in love with Apple?”

A CIO needs to trust their gut instinct, as one can only learn a certain amount in an interview. I think, the strategic fit, is a very good measure. How will a new hire fit into the culture of the company? Will they enjoy it here? Have they worked in a similar culture before? The danger is that the culture could be so alien to the new hire, that they find it difficult to adjust.

9. Know your business and innovate: SJ – “I put out an agenda — 80% is the same as it was the last week, and we just walk down it every single week.”

The CIO and the entire IT department need to know how the business operates, preferably, as intricately as possible. It is that complete overview that will allow innovative opportunities to present themselves.

10. Handling barriers and roadblocks: SJ – “And we pushed the reset button. We went through all of the zillions of models we’d made and ideas we’d had. And we ended up creating what you see here as the iPhone, which is dramatically better.”

CIOs need to know when to intervene. For example, in many cases that could mean stopping projects altogether to take stock of current situations or to change the direction. There is no shame in that as the project has to deliver the project’s core objective.

11. Customer conversion: SJ – “But if we put our store in a mall or on a street that they’re walking by, and we reduce that risk from a 20-minute drive to 20 footsteps, then they’re more likely to go in because there’s really no risk.”

CIOs need to help the businesses by utilising IT to create opportunities in attracting additional customers. They need to ask themselves, “How can we assist in taking the business to the consumer”?

12. When the going gets tough, investment in people always pays: SJ- “What I told our company was that we were just going to invest our way through the downturn, that we weren’t going to lay off people, that we’d taken a tremendous amount of effort to get them into Apple in the first place — the last thing we were going to do is lay them off.”

I covered this, under mobility of management when I covered; can IT Management failure be caused by a deadly disease? Part II. CIOs need to understand the importance of retaining and investing in people as one of the business’s most important assets is yet again confirmed by another business leader. This means that they need to stand by that conviction and avoid losing people in economic downturns.

13. Successful innovation and success in general may be built on failure:SJ -. “Will this resonate and be something that you just can’t live without and love? We’ll see. I think it’s got a shot.”

Apple has proved that failure can lead to success and continues to innovate by investing in many technologies. Some will inevitably fail while others such as the iPod and iPhone will be huge successes. Many businesses lack of innovation is due to their fear of failures.

14. Earn respect: Steve Jobs can be a hard boss to work with but Jobs’ employees remain devoted. That’s because his autocracy is balanced by his famous charisma — he can make the task of designing a power supply feel like a mission from God. CIOs need to command respect from their employees and that is something that has to be earned!

I want to conclude this part by finishing off with a quote that shows us that even with his god like innovative powers, Steve Jobs remains human. “Steve proves that it’s OK to be an asshole,” says Guy Kawasaki, Apple’s former chief evangelist. “I can’t relate to the way he does things, but it’s not his problem. It’s mine. He just has a different OS.”

As Geoffrey Moore, author of Crossing the Chasm said. “He’s at the absolute epicentre digitisation of life. He’s totally in the zone.”

1. A headline. Steve Jobs positions every product with a headline that fits well within a 140-character Twitter post. For example, Jobs described the MacBook Air as “the world’s thinnest notebook.” That phrase appeared on his presentation slides, the Apple Web site, and Apple’s press releases at the same time. What is the one thing you want people to know about your product? This headline must be consistent in all of your marketing and presentation material.

2. A villain. In every classic story, the hero fights the villain. In 1984, the villain, according to Apple, was IBM (IBM). Before Jobs introduced the famous 1984 television ad to the Apple sales team for the first time, he told a story of how IBM was bent on dominating the computer industry. “IBM wants it all and is aiming its guns on its last obstacle to industry control: Apple.” Today, the “villain” in Apple’s narrative is played by Microsoft (MSFT). One can argue that the popular “I’m a Mac” television ads are hero/villain vignettes. This idea of conquering a shared enemy is a powerful motivator and turns customers into evangelists.

3. A simple slide. Apple products are easy to use because of the elimination of clutter. The same approach applies to the slides in a Steve Jobs presentation. They are strikingly simple, visual, and yes, devoid of bullet points. Pictures are dominant. When Jobs introduced the MacBook Air, no words could replace a photo of a hand pulling the notebook computer out of an interoffice manila envelope. Think about it this way—the average PowerPoint slide has 40 words. In some presentations, Steve Jobs has a total of seven words in 10 slides. And why are you cluttering up your slides with too many words?

4. A demo. Neuroscientists have discovered that the brain gets bored easily. Steve Jobs doesn’t give you time to lose interest. Ten minutes into a presentation he’s often demonstrating a new product or feature and having fun doing it. When he introduced the iPhone at Macworld 2007, Jobs demonstrated how Google Maps (GOOG) worked on the device. He pulled up a list of Starbucks (SBUX) stores in the local area and said, “Let’s call one.” When someone answered, Jobs said: “I’d like to order 4,000 lattes to go, please. No, just kidding.”

5. A holy smokes moment. Every Steve Jobs presentation has one moment that neuroscientists call an “emotionally charged event.” The emotionally charged event is the equivalent of a mental post-it note that tells the brain, Remember this! For example, at Macworld 2007, Jobs could have opened the presentation by telling the audience that Apple was unveiling a new mobile phone that also played music, games, and video. Instead he built up the drama. “Today, we are introducing three revolutionary products. The first one is a widescreen iPod with touch controls. The second is a revolutionary mobile phone. And the third is a breakthrough Internet communications device…an iPod, a phone, an Internet communicator…an iPod, a phone, are you getting it? These are not three devices. This is one device!” The audience erupted in cheers because it was so unexpected, and very entertaining. By the way, the holy smokes moment on Sept. 9 had nothing to do with a product. It was Steve Jobs himself appearing onstage for the first time after undergoing a liver transplant.

One more thing…sell dreams. Charismatic speakers like Steve Jobs are driven by a nearly messianic zeal to create new experiences. When he launched the iPod in 2001, Jobs said, “In our own small way we’re going to make the world a better place.” Where most people saw the iPod as a music player, Jobs recognized its potential as a tool to enrich people’s lives. Cultivate a sense of mission. Passion, emotion, and enthusiasm are grossly underestimated ingredients in professional business communications, and yet, passion and emotion will motivate others. Steve Jobs once said that his goal was not to die the richest man in the cemetery. It was to go to bed at night thinking that he and his team had done something wonderful. Do something wonderful. Make your brand stand for something meaningful.

For more of Job’s techniques, flip through this slide show. Then catch a video interview with Carmine Gallo about how he researched his book.

There are so many new management techniques and tools published every year that it is often hard to select one that will actually work within an organisation. I recently came across the 6 box model (Created by Vlatka Hlupic, University of Westminister) and thought that it was a model that could easily be used by organisations that wanted to improve and sustain performance. Today’s business eco system is very different to the one that was prevalent, even quite recently as the early 80’s and 90’s. Professor Vlatka highlights that quite well, in the following slide:

Hlupic Slide

The 6 Box model identifies the main six key performance drivers required by organisations and how they are interlinked and rely on each other to deliver sustainable performance. Usually, when I come across business tools and techniques, the accompanying websites fail to deliver content that supports them. I was therefore quite pleasantly surprised by the 6 box model website that is a mine of information and contains a rich resource of content ranging from an article by professor Vlatka featured in Harvard Business Review that includes marked productivity improvement at both CSC and ANADIGICS. Please also view video on by Marcus Buckingham on ‘strengths’.

6BoxModel

Increasingly, Social Media has been used quite successfully by organisations to tap this resource already found within organisations and I covered this in my blog post, revised recently, ‘Organisations “Don’t get” social media’ . ‘Hlupic points to the example of HCL Technology, a software consultancy in India which developed its own Facebook-style application and used it to create a new business strategy. “Originally, 300 managers would put their strategy ideas to the CEO but with the social media application, they could put their ideas for new strategies to everyone in the global business, so 8,000 people could potentially comment. Everyone could contribute to the planning and everyone could really align themselves with the strategy and live and breath it,” she says. This all happened mid-recession and in the four years since, 70 per cent of all major deals closed by HCL were won against the big four global IT players, the number of customers has grown five-fold and employee attrition is down to 50 per cent. Revenues have also tripled over a four-year period and operating income has also tripled.’

I don’t usually read a book and write about it but I really liked Louis Gerstner’s (LG) very own style of writing and the way that he turned around IBM. In 1993, IBM was losing market share and perhaps on the verge of bankruptcy. Louis Gerstner accepted the job and walked into this situation without really knowing whether he could revive IBM to its glory days.

This series is about leadership and this is the first time I am moving away from offering my thoughts on how CIOs (and others) can apply these leadership practices within their own businesses. The main reasoning is that, I will from now on leave it to my readers to apply what they have learnt from my blog posts. I am increasingly conscious that my readership now envelops many disparate disciplines and I am grateful for that. It has always been my intention that I disseminate my knowledge to others who may benefit as well. After all, knowledge taken to the grave is knowledge lost!

Louis Gerstner started his working in life with McKinsey & Company in 1965, joined American Express as their Head of Travel related Services Group in 1977 and accepted the CEO’s position of RJR Nabisco in 1989. Let’s see what CIOs and general management can learn from this icon of modern business and technology. (In no particular order):

1. Success in general may be built on failure:

As LG started his new job at IBM, he met with the Corporate Management Board (Top 50 executives of IBM) and told them that he had not looked for the job and took it reluctantly as he thought that the responsibility was important to the country’s competitiveness and health. He then went on to outline his expectations:

i. Eliminate bureaucracy by decentralising wherever possible while ensuring the right balance with central strategy and common customer focus.

ii. Benchmarking costs against those of competitors and then achieving best in class status.

iii. Layoffs maybe necessary (Let’s not kid ourselves)

iv. IBM management wanted to breakup IBM into smaller autonomous businesses. LG said, “Maybe that is the right thing to do, but maybe not. We certainly want decentralised, market-driven decision making. But is there not so offer comprehensive solutions, a continuum of support? Can’t we do that and also sell individual products?”

v. About morale, he said, “I want can-do people looking for short term victories and long term excitement.” He also told the audience that it would be his priority to utilise internal talent rather than bringing in outsiders.

I am heavily involved in strategy; the rest is yours to implement. Just keep me informed in an informal way. Don’t hide bad information – I hate surprises. Don’t try to blow things by me. Solve problems laterally; don’t keep bringing them up the line.

Move fast. If we make mistakes, let them be because we are too fast rather than too slow.

Hierarchy means very little to me. Let’s put together in meetings the people who can help solve the problem, regardless of position. Reduce committees and meetings to a minimum. No committee decision making. Let’s have lots of candid, straightforward communications.

I don’t completely understand the technology. I’ll need to learn it, but don’t expect me to master it. The unit leaders must be the translators into business terms for me.“I would say a few things. First, don’t be afraid to make mistakes. That’s how you learn, so I believe a lot in trio al and error and course corrections. Often companies are unwilling to admit when they’ve made a mistake. We tend to question things more in our business.”

3.SWOT analysis: LG pointed out five ninety day priorities on joining IBM and they were:

I. Stop the bleeding of cash as IBM is running out of money.

II. Ensure that IBM is profitable by 1994 (LG joined IBM in April 1993).

III. Develop and implement a customer strategy for the next two years (93,94) that indicated to the customers that IBM had returned and was there to serve them.

IV. Complete the ‘right sizing’ of IBM.

V. Create ‘an intermediate-term business strategy.

4. Constant analysis: With regards to mainframe pricing, LG was convinced that the reason IBM was losing out to competitors was that IBM had the pricing strategy all wrong, so he reversed it with ‘an aggressive price reduction. In addition at a conference attended by approx 175 CIOs and after listening to them during the conference, LG laid out his expectations:

I. IBM priorities would be redefined, starting with the customer.

II. IBM laboratories would be allowed to do what they wanted to do and would deliver open, distributed, user based solutions.

III. IBM would be easier to work with, would recommit to quality and re-establish its leadership position.

IV. IBM would work for the customer and deliver the performance the customer wanted.

5. Improve productivity:– As LG moved forward with re-inventing IBM, he took the following measures to improve productivity:

All of IBM would stay together as one company and not converted into autonomous units.

IBM economic model would be altered, such as expenses as IBM were spending 42 cents to produce $1 of revenue while its competitors were spending only 32 cents..

Business re-engineering would be undertaken. For example processes and systems would be reviewed as internally IBM had 128 CIOs!

Underproductive assets would be sold to generate much needed cash.

6. Business reputation and brand: IBMhad never had a true Head of marketing and just like the processes and the 128 CIO scenario, marketing was controlled by countries and business units etc. That resulted in a totally disjointed marketing campaign. The new Head of marketing decided to consolidate all of IBM’s advertising relationships into a single ad agency. This spawned the “Solutions for a Small planet” and was followed by the coining of the term, “e-business.”

7. Rating of employees’ performance: – In the past, I have reviewed many CEO’s management style but Eric Schmidt’s and Louis Gerstner’s style is the closest fit to Deming’s ‘Annual rate of performance’ that I have yet come across.

“This was all about pay for performance, not loyalty or tenure. It was all about differentiation: Differentiate our overall pay based on the marketplace; differentiate our increases based on individual performance and pay in the marketplace; differentiate our bonuses based on business performance and individual contributions; and differentiate our stock-option awards based on the critical skills of the individual and our risk of loss to competition.”

8. Spotting opportunities:While looking for opportunities, LG met the Head of ISSC (IBM Subsidiary), Dennie Welsh. The opportunity that Dennie had spotted would change IBM forever. “He told me that his vision of a services company was not one that did just IBM product maintenance and strung together computer codes for customers, he envisioned a company that would literally take over and act on behalf of the customers in all aspects of information technology-from building systems to defining architectures to actually managing the computers and running them for the customers. My mind was afire. To be truly successful, we would have to do things that would shake the place to its roots. For example, the services unit would need to be able to recommend the products of Microsoft, HP, Sun and all other major IBM competitors if that, in fact, was the best solution for the customer. Of course, we would have to maintain and service these products as well.”

9. Create and nurture ‘the correct culture.’ – Watson, Sr had created the original culture of IBM but over the years, IBM personnel had moved away from the original ethos of that culture and had started to interpret it quite differently to how it was originally intended. LG made it an imperative to change the IBM culture that was a better reflection and fit for the changing times. The original culture hinged around:

Excellence in everything we do. – This became an obsession with perfection. The culture that developed threatened to halt IBM due to checks, approvals and validation meant that decision making just ground to a halt.

Superior customer service.- This translated into “servicing IBM machines on customers’ premises”, and as a result the customer’s real needs were usually not entertained.

Respect for the individual. – This meant that employees expected their entitlements regardless of performance. This meant that in many instances the best people were not getting what they deserved.

10. Develop a Clear Vision–and Stick to It. – LG “I was always amazed at how many executives thought that “vision” was the same as “strategy.” Vision statements are for the most part aspirational, and they play a role in creating commitment and excitement among an institution’s employees. Good strategies start with massive amounts of quantitative analysis –hard, difficult analysis that is blended with wisdom, insight, and risk taking.”

11. Business/IT Strategy/principles: LG- “I am struck by how much of the culture change of the following ten years they describe”

LG outlined eight principles that were to envelop the business strategy and underpinned the new IBM culture.

1) The marketplace is the driving force behind everything that we do.

2) At our core, we are a technology company with an overriding commitment to quality.

4) We operate as an entrepreneurial organisation with a minimum of bureaucracy and a never-ending focus on productivity.

5) We never lose sight of our strategic vision.

6) We think and act with a sense of urgency.

7) Outstanding, dedicated people make it all happen, particularly when they work together as a team.

8) We are sensitive to the needs of all employees and to the communities in which we operate.

12. Be ‘shrewd’ and keep the team on its ‘toes.’ – LG – “We’re getting our butts kicked in the marketplace. People are taking our business away. So I want us to start kicking some butts-namely, of our competitors. This is not a game we’re playing. We have got to start getting out in the marketplace and hitting back hard. I can assure you, our competitors are focused maniacally on these charts, and they talk us down constantly. For example, this from Larry Ellison (CEO Oracle): “IBM? We don’t even think about those guys anymore. They’re not dead, but they’re irrelevant.”

13. Hire ‘Action’ oriented employees. – LG was once asked, “What do you really want people to do?” He answered, “Win, execute and team.”

“WIN: It was vital that all the IBMers understand that business is a competitive activity. In the new IBM there would be no place for anyone who lacked zeal for the contest.”

“EXECUTE: No more studying things to death. In the new IBM, successful people would commit to getting things done – fast and effectively.”

“TEAM: This was a commitment to acting as one IBM, plain and simple.”

14. Focus: LG – “History shows that truly great and successful companies go through constant and sometimes difficult self-renewal of the base business. They don’t jump into new pools where they have no sense of the depth or temperature of the water.”

15. Quality management: LG ”But alas, too often the executive does not understand that people do what you inspect, not what you expect.”

16. Succession planning and his reputation: LG – “When IBM’s Board of Director’s considered who would succeed me, passion was high on their list of necessary attributes. Sam Palmisano (Current IBM CEO), my successor, is an extraordinary executive – a man of many talents. However, he would never have had my recommendation, despite these many talents, if he didn’t have a deep passion for IBM, for what it stands for, for what it can be, for what it can do.”

Today’s article is the sixth in a series of articles (1stSteve Jobs, 2ndMichael Dell, 3rdWarren Buffet, 4thBill Gates, 5thLarry Ellison), analysing current and past leaders to ascertain how Chief Information Officer’s (CIOs) can learn better management by applying the management practices of leadership, practiced by these leaders.

Eric Schmidt arrived at Google to help Google’s inexperienced founders; Sergey Brin and Larry Page. He has led Google to become a globally recognised company with approx 24000 employees. Recently, he has stepped down to become the chairman and to pass the leadership to Larry Page (on 4th April 2011). Over the years, he has mentored the young founders and believes that the time is now right for them to take the helm. For his efforts, he leaves with a golden shake of $100 million in equity and shares worth 9.1% of Google stock.

“As a CEO, Schmidt is more inclined to provoke than proclaim. “Google is run by its culture and not by me”, said Schmidt in 2009. In Google, when a key executive decision is reached, all interested parties are invited to the decision making process and are encouraged to share their opinions. Schmidt’s job is to oversee the whole procedure and make timely decisions. This bottoms-up way of decision making usually leads to a better buy in and a better decision. Google allows employees to spend 20% of time on self-directed projects. To closely connect to Google’s frontline innovators, each week Schmidt and his senior associates spend up to six hours in dialogue with team members from across Google, who believe their projects have great potential. This unique management style has hatched a series of great products like Gmail and Google News.” Courtesy Vivian’s Tech Blog

PS: CIO is a generic term and other analogous titles are Head of IT, IT Director, Director of IT etc.

The Management Style

What can CIOs learn from Eric Schmidt’s management style? Let’s investigate while allowing you to decide. (In no particular order and a few other sources utilised):

1. How do you run this company? – ES “It’s run in a strange way. We have a normal hierarchical structure. The company is organized ‘bottoms up’ from the standpoint of product creativity and ‘tops down’ from running the quarter and the financials and so forth. We encourage dissent, we encourage large group conversation, we encourage there to be somebody who’s opposed to the decision, and we work very, very hard to be not hierarchical in the way that decisions are made. Often if we can get a decision, we get the best decision if we have two decision makers, not once. We never make decisions in private; we always do them right in front of everybody.” Courtesy Marketplace

2. When the going gets tough, investment in people always pays: ES – “Getting the most out of knowledge workers will be the key to business success for the next quarter century. Here’s how we do it at Google.

At Google, we think business guru Peter Drucker well understood how to manage the new breed of “knowledge workers.” After all, Drucker invented the term in 1959. He says knowledge workers believe they are paid to be effective, not to work 9 to 5, and that smart businesses will “strip away everything that gets in their knowledge workers’ way.” Those that succeed will attract the best performers, securing “the single biggest factor for competitive advantage in the next 25 years.

At Google, we seek that advantage. The ongoing debate about whether big corporations are mismanaging knowledge workers is one we take very seriously, because those who don’t get it right will be gone. We’ve drawn on good ideas we’ve seen elsewhere and come up with a few of our own. What follows are ten key principles we use to make knowledge workers most effective. As in most technology companies, many of our employees are engineers, so we will focus on that particular group, but many of the policies apply to all sorts of knowledge workers.” – Courtesy 1000 Ventures

“When Eric joined Novell, the company’s future was very much in doubt. He correctly recognized a culture of fear that pervaded the organization. Bright engineers with revolutionary ideas were reluctant to voice them for fear of being fired. The engineers however, complained vociferously amongst themselves leading to a culture of corporate cynicism. Recognizing this pervasive bellyaching, Eric asked two engineers he met on the company shuttle, to give him the names of the smartest
people they knew in the company. Eric met with each of them, and asked them in turn to identify the 10 smartest people they knew. In a few weeks, Eric had a list of 100 engineers he considered critical to Novell’s future. He met with each of them personally, encouraging them to take chances and follow their instincts. He removed the possibility of reprisals by their managers for voicing their opinions. This inspired the engineers and focused their efforts, resulting in innovative and improved products. These changes helped Novell transform itself from a loss of $78
million to a gain of $102 million”. – Courtesy Scribd.com

One person alone cannot handle everything. The secret is to surround yourself with employees that are smarter than yourself. These smart people will challenge organisations and force them to think differently. I covered this, under mobility of management when I covered; can IT Management failure be caused by a deadly disease? Part II. CIOs need to understand the importance of retaining and investing in people as one of the business’s most important assets is yet again confirmed by another business leader.

3. Business/IT Strategy: – “At Google, Eric has stated the company’s goal as “…Organizing the world’s information making it universally accessible and useful”. An engineer working to index billions of web pages can easily identify with this laudable goal. As a practical matter the goal of making information universally accessible is a more
meaningful goal for the engineer, interested in making his mark on society, rather than a mundane goal of increasing Google’s revenues by $300 million dollars. Eric considers this transfer of ownership to be so important that while at Novell he created a quarterly in-house radio show modeled after NPR’s “Car Talk”. He even made tapes available for in-car listening.” – Courtesy Scribd.com

Sometimes it’s best to follow your instincts and to believe in yourself to do the right thing. Paralysis by analysis is often the cause that many organisations cannot do well. It’s as Nike says, Just do it!

4. Rating of employees’ performance: – In the past, I have reviewed many CEO’s management style but Eric Schmidt’s style is the closest fit to Deming’s ‘Annual rate of performance’ that I have yet come across.

“Eric management style is to let the team’s progress be reviewed by individuals the team respects. In most companies there exist a few individuals that are universally respected or at least more respected than everyone else.
These individuals have a way of articulating principles and have very good memories. Since they are considered impartial, teams are more open to receive feedback or decisions even if the decision goes against them. – Courtesy Scribd.com

5. Earn respect by ‘listening’: – ES “Listening to each other is core to our culture, and we don’t listen to each other just because we’re all so smart. We listen because everyone has good ideas, and because it’s a great way to show respect. And any company, at any point in its history, can start listening more.” Courtesy Andrew McAfee

6. Competitive advantage:– This is an area of great interest, as currently, Google is the undisputed king of search but Microsoft’sa Bing is knocking on its doors. So, for the moment Google is able to keep its competitive advantage. The worry for Google has been the defection of key employees (who view Facebook as ‘cool and the place to be’) to companies such as Facebook. Social Media is an area where Google doesn’t really have a strong foothold and that is worrying for them while in the mobile arena, Android is not a huge money earner (albeit, earnings are approx $6 per user per year) when compared to Apple IOS. Google is in a battle with Apple, Microsoft and Facebook and it is ambiguous which markets Google ultimately wants to compete within.

7. Talent acquisition – Hire ‘Action’ oriented employees:“I might have been mistaken, actually. Having your name and picture up on that big screen at End of Quarter may not be the biggest incentive. The thing that drives the right behavior at Google, more than anything else, more than all the other things combined, is gratitude. You can’t help but want to do your absolute best for Google; you feel like you owe it to them for taking such incredibly good care of you.” Source unknown, courtesy Oliver Thylmann

Google actively recruits recent Ph.D.’s and Ph.D. candidates. All 1,900 Google employees are researchers and developers in addition to their regular duties. Where other companies will keep their research departments and core businesses separate, Google places all their Ph.D.’s in the rank and file of the company. Workers at Google enjoy a company devoted to benefits (Stross, 2004). They also enjoy an informal company culture where employees have access to gyms, massages, pool and ping-pong tables, well stocked snack rooms and other recreational amenities (Google Culture, 2009). Courtesy Marty Andrade

A CIO needs to trust their gut instinct, as one can only learn a certain amount in an interview. I think, the strategic fit, is a very good measure. How will a new hire fit into the culture of the company? Will they enjoy it here? Have they worked in a similar culture before? The danger is that the culture could be so alien to the new hire, that they find it difficult to adjust.

Eric Schmidt has hired the smartest people who can ‘get the job done.’ Hire your friends and past colleagues, as they will have loyalty to you and as you know them personally, an informed decision can be made on whether they have what it takes to realise your ‘vision.’

8. Spotting opportunities and innovation: LE – “innovation is the key to Google’s success, everything Schmidt does revolves around creating more innovation. Without it, Schmidt believes there is nothing to prevent another company from overtaking Google as the king of digital information. Innovation is systematically encouraged at Google at all levels throughout the organization, including management. At Google, management follows the “70/20/10″ rule where seventy percent of their time is spent on core business projects, twenty percent is spent on projects related to the core business and ten percent is spent on projects unrelated to the core business (Battelle, 2005). Schmidt, in order to remain true to the 70/20/10 rule, actually divides these projects into different rooms and tracks his time spent in each of the rooms.” Courtesy Marty Andrade

There have been a lot of articles written in the past on the merits of being the second mover into an area of business , proceeding to become the market leader. Recently, the best product to succeed has been the iPhone.

I wanted to go behind the scenes and contribute by adding the fact that businesses do indeed succeed by being the second or third mover but success happens due to many factors. All of these factors or some of the ones that I will discuss amalgamate to create the success or competitive advantage/tipping point.

I have created a ‘second mover toolset’ for CEOs and senior management (In no particular order) that helps to create a synergy between business strategy, culture and employees (people).

Sometimes it’s best to follow your instincts and to believe in yourself to do the right thing. Paralysis by analysis is often the cause that many organisations cannot do well. It’s as Nike says, Just do it!

3. Spotting opportunities:SJ – “We all had cellphones. We just hated them, they were so awful to use.”

The lesson that can be learnt is that CEOs need to spot opportunities for improvement. It is not enough, however, just to spot them, the onus is to spot them and then to create an environment to leverage that opportunity and to make it happen.

4.Focus: SJ – “People think focus means saying yes to the thing you’ve got to focus on. But that’s not what it means at all. It means saying no to the hundred other good ideas that there are. You have to pick carefully.”

A CEO needs to focus on the most important issues that are relevant to the business and to shy away from the issues/projects that do not add value to the business but may just be a ‘nice have’ or appear to add value. Learn to say, ‘No’.

5. Know your business and innovate: SJ – “I put out an agenda — 80% is the same as it was the last week, and we just walk down it every single week.”

The CEO and the entire business need to know how the business operates, preferably, as intricately as possible. It is that complete overview that will allow innovative opportunities to present themselves.

6. Handling barriers and roadblocks: SJ – “And we pushed the reset button. We went through all of the zillions of models we’d made and ideas we’d had. And we ended up creating what you see here as the iPhone, which is dramatically better.”

7. Customer conversion: SJ – “But if we put our store in a mall or on a street that they’re walking by, and we reduce that risk from a 20-minute drive to 20 footsteps, then they’re more likely to go in because there’s really no risk.”

CEOs need to help the business by helping to identify opportunities in attracting additional customers. They need to ask themselves, “How can we assist in taking the business to the consumer”?

8. When the going gets tough, investment in people always pays: SJ- “What I told our company was that we were just going to invest our way through the downturn, that we weren’t going to lay off people, that we’d taken a tremendous amount of effort to get them into Apple in the first place — the last thing we were going to do is lay them off.”

I covered this, under mobility of management when I covered; can IT Management failure be caused by a deadly disease? Part II. CEOs need to understand the importance of retaining and investing in people as one of the business’s most important assets is yet again confirmed by another business leader. This means that they need to stand by that conviction and avoid losing people in economic downturns.

9. Successful innovation and success in general may be built on failure:SJ -. “Will this resonate and be something that you just can’t live without and love? We’ll see. I think it’s got a shot.”

Apple has proved that failure can lead to success and continues to innovate by investing in many technologies. Some will inevitably fail while others such as the iPod and iPhone will be huge successes. Many businesses lack of innovation is due to their fear of failures.

10.Family commitment:Michael Dell – MD “I think we make a priority to bring balance into our lives. To me, family is very important. So if you look at my schedule, one of the things I realized a long time ago is that there is a limit to how much productive work you can actually do in a given week. There’s also the happiness factor; if you want to do something for a long time and be really good at it, you’d better have a strategy that is sustainable and works within what’s going on in the rest of your life. For me that means that I’ve got to have time with my family; I’ve got to have time to exercise; I’ve got to have time to sleep; I’ve got to be able to take my kids to school.”

This is an aspect of life that I firmly believe in as well. Time cannot be turned around or replaced. It is very important that we spend time with spouses and spend time with our children. As they grow up we have to ensure that they become responsible and active citizens. A work/life balance is crucial and ensures that we work optimally.

11.Learning: MD – “Continuous learning is also important.”

All great leaders have made it a habit to constantly learn. MD visits the companies that impress him by paying them a visit to learn how to improve himself and Dell. Other leaders such as Bill Gates are very well read and read books to improve their knowledge. The knowledge of all great minds, past and current, is available. It is upon us to seek that knowledge.

12. Risk assessment and crisis management: Warren Buffet – WB ‘If there is any significant bad news, let me know early’. The team need to have confidence in the CEO, in order that ‘bad news’ events/issues/problems can be resolved prior to them mothballing to the ‘point of no return.’ ‘An investor needs to do very few things right as long as he or she avoids big mistakes.’

13. Business reputation: WB –‘Look at the business you run as if it were the only asset of your family, one that must be operated for the next 50 years and can never be sold’. He adds that ‘We can afford to lose money – even a lot of money. We cannot afford to lose reputation – even a shred of reputation.’ CEOs need to understand that as witnessed by the recent BP oil spill crisis. It had a devastating effect on BP’s reputation, wiped millions off its share price, cost billions to settle claims and control the oil spill. Additionally, the irrecoverable loss of both human and marine life, coupled with the environmental damage leaves the oil giant in shambles.

14. Quality management: ”What I must understand is why someone will continue to get out of bed in the morning once they have all the money they could want,” Buffett says. ”Do they love the business, or do they love the money?” CEOs need to have a team that enjoys working within the associated line of business.

15. Trustworthiness and integrity: Developing characteristics such as trustworthiness and integrity, Buffett believes, is a matter of forming the right habits. “The chains of habit are too light to be noticed until they are too heavy to be broken,” he says. People who stray from these values often show up on Wall Street; they may initially even shine; but eventually they self-destruct. “That is sad, because it does not need to happen,” says Buffett. “You need integrity, intelligence and energy to succeed. Integrity is totally a matter of choice — and it is habit-forming.”

16. Develop a Clear Vision–and Stick to It. – From the beginning, Bill Gates dreamed of developing Microsoft into a corporate giant. For CEOs this is one of the most important traits that MUST be part of the toolbox.

CEOs need to clearly identify to themselves and communicate to the environment that they work in ‘the vision’ that they have set out to achieve. They then need to have the confidence to deliver that vision.

17. Hire ‘Action’ oriented employees. – CEOs usually have exposure to many different environments and come across many employees. Some will be better than others, while some will be outstanding. Gates has always hired the smartest people who can ‘get the job done.’

18. ‘Stop’ the ‘mad bureaucracy’ – I have mentioned this before in a post (can’t think of which one though) and it gets reiterated by Microsoft. As Matt said, ‘The plague of most big companies is bureaucracy and stupid rules. Thielen gives the example of an un-named high-tech company that sent a four-page memo to all of its employees on proper security badge procedure, including infinitesimal details on how and where to wear the badge.

To that, Thielen states, “Does Microsoft manage to avoid this type of inane garbage? By and large, yes.” Unlike most companies, Microsoft actually assumes its employees are smart. Rules at Microsoft are few and far between, and the ones that exist tend to make sense. Having only a few important, logical rules means that employees actually remember and follow them.

19. Annual rating of performance

This is an area of Dr Deming’s theories that I do not have to adjust for CEOs. The annual rating of performance is an arbitrary and unjust system that demoralises employees and nourishes short term performance. It has an added side effect as it annihilates team work and encourages fear.

This annual rating of salaried people is also called the Merit system, annual appraisal and management by objective – management by fear is a better term. This system works by rewarding employees for what they have done in the past year, i.e. performance pay. The effect is devastating as the employee must have something to show and this in turn nourishes short term performance and annihilates long term planning and team work. As each employee is encouraged, to show and prove their individual contribution to qualify for the performance pay, it stifles team working. Even if individuals are working productively as a team, inadvertently, they are identifying ways in which to use the team work to justify that all important, performance pay!

Dr Deming’s theory encourages teamwork in its true sense. Actively listen to other team members’ views and ideas and counter members’ weaknesses while using the strengths of the team. This is impossible under a merit rating.

Even more damaging is the fact that when ratings are given out they cannot be understand well enough by employees and as to why they were not rated high enough.

It would be better if this system was a lottery where at least there is a good reason not to understand better, as employees would not feel superior or inferior.

20. Mobility of management

The annual rating of performance encourages mobility of management. As employees are not getting a raise, they are not loyal anymore. This has a devastating effect on the business as people have no roots in the company and are not there long enough to understand the business well enough. Management requires good knowledge of the company, its problems, production and service capabilities and that takes a long time.

For example, if a project manager has just arrived at the business and does not understand its culture, overview of its IT systems, IT and business strategy and is made to work on an individual project, how can he/she understand the overall impact of what it is they are delivering?

21. Use of visible figures only

Most businesses will use figures that are known, for example, service desk figures. This is because most business schools and graduate degrees encourage us to use these figures. The power is in knowing known, unknown and the unknowable.

Now, the question some of you may ask is that, if it is unknown, how could it be important? Well, we need to understand the multiplying effect of a happy customer and also the unhappy one. Understanding these figures is absolutely crucial for all departments, as just with the given example, if we can understand the multiplying effect, we can harness the effect and turn the unhappy customers into ambassadors within the business.

Today’s article is the fourth in a series of articles (1st – Steve Jobs, 2ndMichael Dell, and 3rd was written on Warren Buffet, analysing current and past leaders to ascertain how Chief Information Officer’s (CIOs) can learn better management by applying the management practices of leadership, practiced by these leaders.

Gates has led Microsoft from start-up to‘software giant’ with quite an unorthodox style of management. On Microsoft’s website, he measures Microsoft’s success as, “We’ve really achieved the ideal of what I wanted Microsoft to become.”

PS: CIO is a generic term and other analogous titles are Head of IT, IT Director, Director of IT etc.

The Management Style

What can CIOs learn from Gate’s management style? Let’s investigate while allowing you to decide. (In no particular order and a few other sources utilised):

1. Create and nurture ‘the correct culture.’ – ‘John Battelle co-founded Wired Magazine. He says Microsoft was the pioneer of the new-agey workplace, making work as comfortable, inspiring and fun as possible so workers would spend lots of time there.

John Battelle: And as a matter of fact, at Wired we adopted that stuff. We had a chef and a masseuse, all sorts of services, because we wanted our employees to stick around. I believe Microsoft gets a lot of credit for that.

Bill Gates didn’t even finish college, but the office culture he created at Microsoft is now being taught at the country’s top business schools.’ – Courtesy of Marketplace

2. Develop a Clear Vision–and Stick to It. – From the beginning, he dreamed of developing Microsoft into a corporate giant. For CIOs this is one of the most important traits that MUST be part of the toolbox.

CIOs need to clearly identify to themselves and communicate to the environment that they work in ‘the vision’ that they have set out to achieve. They then need to have the confidence to deliver that vision.

3. Hire ‘Action’ oriented employees. – CIOs usually have exposure to many different environments and come across many employees. Some will be better than others, while some will be outstanding. Gates has always hired the smartest people who can ‘get the job done.’

Hire your friends and past colleagues, as they will have loyalty to you and you personally know whether they have what it takes to realise your ‘vision.’

4. Relax and feel at home – According to Matt Richey, ‘Microsoft has a simple way of maximizing its employees’ productivity: It allows each individual’s office to be as individualized as one desires.

That means making the office more like home. Everything from real offices (not cubicles) to windows in most offices, from free soft drinks to no dress code, from an open supply room to anything-goes work hours. Quite simply, these policies improve employee morale, and thus increase overall productivity.’

5. ‘Image’ is everything. – Gates has successfully changed his image over the years from a geek to corporate leader and philanthropist.

CIOs need to change their image from just being technology leader to leaders who understand business and can apply their strategic IT and business skills to the wider business.

6. Successful innovation and success in general may be built on failure: Yep, Gate’s has constantly had Microsoft innovating along. Currently though, as many large IT businesses employ smarter and smarter employees, time will judge who can innovate the most and bring to market technologies that have ‘stickiness.’

The question these companies have to ask themselves is that can employing ‘smarter’ employees stop the next Google , or Microsoft from raising its head?

Microsoft has proved that failure can lead to success and continues to innovate by investing in many technologies. Some will inevitably fail while others maybe huge successes. Many businesses lack of innovation is due to their fear of failures.

7. Be ‘shrewd’ and keep the team on its ‘toes.’ – Gate’s, is known for his sharp cross examination of employees who present new ideas, innovations etc.

He analyses information quite quickly and gets to the bottom of the matter at a rapid pace. Employees have criticised this approach and associated quick, sharp, snappy analysis that at times is uncomfortable (in employee’s views). These qualities of Gate’s have enabled Microsoft to dominate personal computers (PCs). CIOs need to understand employee perspectives and ‘effectively quiz’ their teams on solutions being proposed.

8. Ruthlessly protect your ‘budget.’ – According to Matt Richey, ‘Even with its billions upon billions in cash, Microsoft is as frugal as Ebenezer Scrooge. It’s a company that buys canned weenies for food, not shrimp. Until last year (1999), even Bill Gates and his second-in-command Steve Ballmer flew coach. (For scheduling reasons, the company purchased its first corporate jet.)

Bucking the trend of most large, wealthy corporations, Microsoft remains in start-up mode where tight budgets are the rule. When you sit back and think about it, this frugality is less surprising and even explain how a company can come to accumulate such great hoards of cash.’

9. ‘Stop’ the ‘mad bureaucracy’ – I have mentioned this before in a post (can’t think of which one though) and it gets reiterated again by Microsoft. As Matt said, ‘The plague of most big companies is bureaucracy and stupid rules. Thielen gives the example of an un-named high-tech company that sent a four-page memo to all of its employees on proper security badge procedure, including infinitesimal details on how and where to wear the badge.

To that, Thielen states, “Does Microsoft manage to avoid this type of inane garbage? By and large, yes.” Unlike most companies, Microsoft actually assumes its employees are smart. Rules at Microsoft are few and far between, and the ones that exist tend to make sense. Having only a few important, logical rules means that employees actually remember and follow them.

Now, as we all know from the blog post, Warren Buffet’s (World’s most successful investor) management style and CIOs, the technology business is not considered a viable investment by him as he admits that he doesn’t understand technology and considers technology too volatile. So, when Don Fornes wrote that he thought Consona had acquisitioned Compiere ‘because the Compiere product is built on a very modern technology stack and is designed to run in a cloud computing environment’ it made sense.

This was also confirmed by a quote by Consona’s CTO, Steve Bailey, ‘Compiere is the world’s leading open-source ERP solution and the products are brilliantly architected. They run on a fully open-source stack (e.g., Java, Linux, JBOSS, Postgres), utilize a browser-based AJAX UI based on the Google Web Toolkit, and are fully operational either on premise or on a utility cloud platform like Amazon…’

Don went on to say, ‘While Consona has acquired a number of software companies based on this model, that doesn’t seem to be the strategy behind the Compiere deal. Compiere brings only 130 customers to Consona and I doubt Compiere’s open-source business model was generating big profits. Instead of buying customers and profits, Consona seems to be thinking ahead about how they can lead the market in the next generation of technology. The acquisition is more about growing organically – selling more Compiere systems – than it is about harvesting customer support contracts.’

‘Why is this all relevant to software buyers? Because there is a big shift underway from client/server systems installed “on premise” to cloud-based or software-as-a-service systems that are hosted in a secure data center and accessed through a web browser. Moreover, the open source movement is producing underlying technology that is not only free, but increasingly really good stuff. Software vendors that don’t make the transition will wither on the vine.’

‘To highlight the significance of this model, consider that a bunch of brilliant Google engineers built some cutting edge user interface technology (Google Web Toolkit) and open sourced it. Compiere turned around and used it in their products. Google did a big part of Compiere’s engineering for free…and will continue to do so. Now that’s efficient development.’

‘Compare that to an application software company that has to pay ongoing royalties to an infrastructure software company for the privilege of developing on its outdated database or development tools. The smart engineers long since left both companies so they could work on cooler projects at more modern software companies. The mediocre engineers that remain are having a hard time developing new features on old code. Sales are declining and customers are defecting (albeit slowly because it’s hard to switch).’

‘You don’t want to be that customer that is trying to defect but fears the switching costs. You want to be the delighted customer that loves their software because it works today and will work tomorrow, regardless of what new requirements emerge.’

As we are constantly bombarded by marketers and pushed towards cloud computing models, please remember that (as Marcela Cueli said in his article),

‘For a start, cloud computing is not a technology but a model of provision and marketing IT services that meet certain characteristics. Cloud is all about computer services, not products:

* The infrastructure is shared. Multiple clients share a common technology platform and even a single application instance.

* The services are accessed on demand in units that vary by service. Units can be, for example, user, capacity, transaction or any combination thereof.

* Services are scalable. From the user’s point of view, services are flexible; there are no limits to growth.

* The pricing model is by consumption. Instead of paying the fixed costs of a service sized to handle peak usage, you pay a variable cost per unit consumption (users, transactions, capacity, etc.) that is measured in time periods that can vary, such as hour or month.

* Services can be accessed from anywhere in the world by multiple devices. The cloud model leads to basically two different kinds of clouds: private and public. The public clouds are those that offer IT services to any customer over the Internet. Private clouds offer IT services to a predefined group of customers, with access through Internet or private networks. You might have also heard about internal and external clouds. The former are a subgroup of the private clouds, and provide services within the same company or corporate group. The latter may be public or private and provide services to other companies.’

To conclude, this is exactly what I have been discussing in my blog posts over the last year or so. Don’s thoughts are increasingly reflective of the technology blogosphere as technology writers’ such as Don and I understand the repercussions of the effects of cloud computing on traditional client/server models and associated revenue streams, licensing etc.

There are many facets that I have covered over the last year or so that lead companies to be in this vulnerable position where they have to resort to acquisitions to remain contenders within their marketplace. My blog posts mentioned earlier have considered these, so apart from the above posts, I will leave you with some other posts that should help companies and their management become successful.

PS: CIO is a generic term and other analogous titles are Head of IT, IT Director, Director of IT etc.

The Management Style

Warren Buffet is one of the world’s richest men and a very successful investor. For today’s blog post I have selected a truly unique individual. He works from his office that lacks a computer and surprisingly his desk is bereft of research on stocks and shares.

Before we go any further, one particular event caught my attention that captures a facet of Warren Buffet’s management style. So, I have decided to share it with everyone. According to BusinessWeek, ‘We arrive late to Paris, touching down in a freakish, near-gale-force windstorm that both thrills and alarms our pilot. In four cars, we race as fast as rush-hour Paris traffic allows from Le Bourget to Dassault Aviation Group’s magnificent 19th century chateau–familiarly known as Le Rond Point–on the Champs Elysees. EJA is the largest commercial customer of Dassault Aviation, Europe’s leading manufacturer of business jets. Serge Dassault, the company’s chairman, is hosting tonight’s gala reception and dinner in Buffett’s honor. By the time we arrive, the reception is in full swing. But Buffett takes a few steps into the foyer and hustles up a flight of stairs. It will be a good 35 minutes until he descends and joins the party.

Downstairs, the guest of honor’s whereabouts is Topic A among Dassault’s distinguished guests. It might puzzle them to learn that Buffett is on a transatlantic call to one of his employees. The matter he is discussing with Ajit Jain this evening is not urgent. But it is Buffett’s custom to speak with Jain every evening. If that means keeping 200 of France’s richest people waiting, then c’est la vie.’

What can CIOs learn from Warren Buffet’s management style? Let’s investigate while allowing you to decide. (In no particular order and a few other sources utilised):

1. Business assessment: When looking to invest, Warren Buffet looks to satisfy ‘five’ essential criteria, equally CIOs can apply similar criteria when looking to invest their expertise towards business assessment. Buffet – ‘Never invest in a business you cannot understand.’

Warren Buffet investment criteria

CIO ‘business’ assessment criteria

1

Is the company simple and understandable?

Is the business model, simple and understandable?

2

Does it have a consistent operating history?

Has IT consistently assisted the growth or well being of the company?

3

Does it have favourable, and predictable, long- term prospects?

Is IT viewed favourably within the company and can IT predict how it can help the company’s long-term prospects?

4

Is the management competent and honest?

Is the IT management team competent and aligned to the business vision?

5

Is the underlying business undervalued?

Is IT undervalued? How can IT deliver ‘more’ value from existing resources?

2. Ownership: In the 2010 Berkshire Hathaway (BRKA) annual report, Buffett wrote of his holding company: “We tend to let our many subsidiaries operate on their own, without our supervising and monitoring them to any degree. Most managers use the independence we grant them magnificently, by maintaining an owner-oriented attitude.” Buffett wants Berkshire Hathway’s managers to think like owners. Their rewards are tied exclusively to the achievements of their own businesses, not those of Berkshire Hathaway – a principle to which Buffett holds very strongly. “We delegate to the point of abdication,” Buffett says in Berkshire’s Owner’s Manual. CIOs need to instil their teams with similar beliefs. Every individual within the CIOs team needs to think as if they were the ‘owner’s’ of the business, especially the CIOs main management team.

3. Risk assessment and crisis management: Buffet – ‘If there is any significant bad news, let me know early’. The team need to have confidence in the CIO, in order that ‘bad news’ events/issues/problems can be resolved prior to them mothballing to the ‘point of no return.’ ‘An investor needs to do very few things right as long as he or she avoids big mistakes.’

4. Succession: Buffet – ‘send me a letter updating your recommendations as to who should take over tomorrow if you became incapacitated tonight. Anything you send me will be confidential’. CIOs need to have succession planning in order that the business has continuity in the unfortunate event of a CIO not being able to provide management.

5. Business reputation: Buffet –‘Look at the business you run as if it were the only asset of your family, one that must be operated for the next 50 years and can never be sold’. He adds that ‘We can afford to lose money – even a lot of money. We cannot afford to lose reputation – even a shred of reputation.’ CIOs need to understand that IT systems can enhance and taint a company’s reputation. The recent BP oil spill crisis reflects that as it had a devastating effect on BP’s reputation, wiped millions off its share price, cost billions to settle claims and control the oil spill. Additionally, the irrecoverable loss of both human and marine life, coupled with the environmental damage leaves the oil giant in shambles.

6. Quality management: ”What I must understand is why someone will continue to get out of bed in the morning once they have all the money they could want,” Buffett says. ”Do they love the business, or do they love the money?” CIOs need to have a team that enjoys working within IT and associated line of business.

7. Competitive advantage: Warren Buffett was once asked what is the most important thing he looks for when evaluating a company to invest in. Without hesitation, he replied, “Sustainable competitive advantage.” CIOs need to ask themselves how they can help the business through leveraging IT to create competitive advantage? I covered this a few months ago, in my post, Leveraging IT for Competitive Advantage – Myth or Reality? Companies with a sustainable economic advantage need honest, capable and hardworking leaders to retain their lead. Berkshire-Hathaway’s managers have one instruction: Widen the moat. That keeps the castle valuable.

8. Use numbers to season the points you serve — they’re not the main dish: (Points 8,9,10,11 courtesy of the Harvard Business Review blog)Buffett doesn’t just report on the underwriting gains of their insurance businesses and let the numbers stand for themselves; he explains the terminology, what the numbers mean, and how he and Charlie Munger, his business partner, view them. Case in point: “Our $58.5 billion of insurance “float” — money that doesn’t belong to us but that we hold and invest for our own benefit — cost us less than zero. In fact, we were paid $2.8 billion to hold our float during 2008. Charlie and I find this enjoyable.”

9. Use analogies and metaphors. A great example is Buffett’s description of how many of us felt after the economic collapse in 2008: “By year end, investors of all stripes were bloodied and confused, much as if they were small birds that had strayed into a badminton game.” And he goes on to describe the government’s response: “In poker terms, the Treasury and the Fed have gone ‘all in.’ Economic medicine that was previously meted out by the cupful has recently been dispensed by the barrel.” These metaphors do more to explain his points than paragraphs of technical jargon ever could.

10. Be honest and transparent. Buffett follows-up a recap of 2008 successes with the following revelation: “During 2008 I did some dumb things in investments. I made at least one major mistake of commission and several lesser ones that also hurt. I will tell you more about these later. Furthermore, I made some errors of omission, sucking my thumb when new facts came in that should have caused me to re-examine my thinking and promptly take action.” Instead of deflating his credibility, this kind of refreshing candidness makes the audience more trusting of whatever else he might say: after all, he’s clearly not hiding anything. ‘It is more important to say “no” to an opportunity, than to say “yes”.’

11. Use facts to put things in realistic context. After explaining how bad the economic situation was in 2008, Buffett gave a fact-based context for how to view these realities. “Amid this bad news, however, never forget that our country has faced far worse travails in the past. In the 20th Century alone, we dealt with two great wars (one of which we initially appeared to be losing); a dozen or so panics and recessions; virulent inflation that led to a 21 1/2% prime rate in 1980; and the Great Depression of the 1930s, when unemployment ranged between 15% and 25% for many years. America has had no shortage of challenges. Without fail, however, we’ve overcome them. Compare the record of this period with the dozens of centuries during which humans secured only tiny gains, if any, in how they lived. Though the path has not been smooth, our economic system has worked extraordinarily well over time.”

12. Follow your instinct: Buffet – ‘Do not follow the crowd. Ignore the market, the crowd, and its fashions.’‘It is not necessary to do extraordinary things to get extraordinary results.’

13. Research: Buffet – ‘Do not rely on outside analysis. Do your own research – and do it thoroughly.’ ‘Do not often act on a hunch. Always have sound, well-argued, well-researched reasons for your investments.’

14. Trustworthiness and integrity: Developing characteristics such as trustworthiness and integrity, Buffett believes, is a matter of forming the right habits. “The chains of habit are too light to be noticed until they are too heavy to be broken,” he says. People who stray from these values often show up on Wall Street; they may initially even shine; but eventually they self-destruct. “That is sad, because it does not need to happen,” says Buffett. “You need integrity, intelligence and energy to succeed. Integrity is totally a matter of choice — and it is habit-forming.”

15. Buy at the right price: Purchases must be made at the right price if they are to pay off.

No less an authority, John F. Welch, CEO of General Electric Co., considers Buffett a superb judge of managerial talent. Buffett and Welch have gotten to know each other over the years as golf partners and as rivals in auto insurance and other businesses. ”Take 20 people you know quite well but Warren has just met casually,” Welch says. ”If you ask Warren his opinion about them, he’ll have each one nailed. He’s a masterful evaluator of people, and that’s the biggest job there is in running a company.”

Asked why he has not retired despite his phenomenal wealth, Buffett said the reason is that he has more fun doing what he does than anything else. “The fundamental thing is that the process should be fun,” he said. “I had just as much fun when I had $10,000 to invest as I do now. It’s crazy to do things for your resume. It’s like saving up sex for your old age. You should do what you enjoy as you go along, and work with people you admire. I look forward every day to the next day. I’m wired for this game.”

For the long haul, Warren Buffett’s way must be best. As an associate says, ‘somehow Warren has been able to keep a diverse cast of characters working harder for him than they did for themselves. I see it every day – and I still don’t know how he does it’. Having read all the above, though, you will have a good idea of the maestro’s magic methods. Use them.

Last year (2010), I discussed Cloud Computing and whether Cloud Computing (or as referred to by a few readers – Internet Based and Grid Architecture/A managed or hosted service) was, well, ready for use as an IT system within the cloud. I still believe that Cloud Computing is definitely ready to be used by new start-ups as an IT system. Established businesses that have an investment in existing IT systems will have to manage this by considering an organisation’s requirements very carefully. Like any other project, any move to the cloud, has to be managed as a project. I mentioned this, in my post, What is Cloud Computing? Its Pros/Cons and making it work and Enterprise Resource Planning (ERP) – Past, Present, Future and successful implementation .

Last year, I was approached by a business to advise on setting up a new IT system. I had a look at their requirements and decided that there was no need to invest in a traditional IT system based around an in-house data centre and associated hardware; i.e. servers etc. Further research showed that Google Apps could be used as their main IT system. The version, I chose was Google Apps for business ($50 per user per annum) and the link preceding this text compares the FREE version with the business version. Recently, (2011), Google has incorporated all the tools that were available for FREE, when users signed up for a regular Google/Gmail Account. This included my favourites, such as Alerts and Google URL shortener. For some reason though, Web History is not enabled on Google Apps, so if you want to use that feature, you will have to resort to your normal Google/Gmail account.

There is a FREE version of Google Apps for Educational bodies and Charities (US based with 3000 + users get a 40% discount). Now, Google are not doing this out of the goodness of their heart as they are a commercial entity. It is a long term strategy. A quick question for all of you. Who leaves education to control future markets and organisations? Yep, its students, and if Google can get them to use Google Apps, it might just push them to stop using Microsoft. The stakes are high and Google are muscling in on Microsoft territory. As I said a few weeks ago, Microsoft’s problem is that their software solutions are predominantly premise(s) based, while Google started life within the cloud!

I have kept close contact with the tech leads provisioning and setting up the system and my findings are as follows:

Google Apps has been able to provide a solution that incorporates most of the IT requirements for a new business. These mainly consist of Google Docs (Word processing, spreadsheet, presentation and drawings package), Email (25GB of space per user), calendaring facility, Google Groups to create mailing lists and to share calendars, docs, sites, chat and Google Talk, videos (300MB per user) and the sites functionality.

The tech team were quite impressed with Google sites (template driven system with new templates added daily) that allowed them to create numerous sites for use, both, within the business and externally. The feature that particularly impressed them was the ability to enable any internal site (For example, an Intranet site) to be accessible externally quite quickly by changing a few settings and the ability to map (point) the site to another website or domain. For example, the default for any Google site is: http://sites.google.com/a/yourdomain.com/nameof yoursite , and you could map your Google site to one of your sub domains (the prefix prior to http://www.yourcompany.com) so that it displays in the browser as, for example, http://www.widgets.yourcompany.com .

Email security is good with the inclusion of the Postini service that protects against Junk (spam) email and provides virus filtering. This includes junk and virus filters for blocking unwanted email messages. The junk filters include an overall filter as well as specific category filters that let you or your users fine tune how aggressively the service filters specific types of junk email. By default, the overall junk filter is set to level 2 (out of 5 levels) and the virus filter is set to On.

The chat feature that is available within email as an integrated window allows Google Talk gadget functionality and supports: chat, voice calls, off the record chats and chat history. In addition, the gadget recognises Google Video, YouTube, Picasa Web Album, and Flickr URLs and converts them into playable video or slideshow within the chat window! Multi-user chats and ‘Invisible’ status are also available only in the gadget.

Google marketplace allowed the techs to incorporate a social media solution, called Socialwok (Standard Edition – FREE – Service terminated 12.7.11). Why, well there are many reasons and most of them can be gleaned from their case studies; Complinet said“Before Socialwok if I found an interesting news story or development on the web then, I had to remember who to send it to within the company. Now I simply post a status update to the ‘industry news’ feed in Socialwok. I know that all of my colleagues around the globe will see it. We use socialwok as an internal tool for sharing information quickly and efficiently. It is particularly useful for getting the views and opinions of different team members across the globe. The Socialwok team is also every responsive to questions and open to new ideas. This is important to us as it means that the product is always developing and improving as our organisation expands adoption of Socialwok.”– Paul Tasker, Head of Product Marketing

Those of you that follow my blog would also know that I am a BIG mind mapping fan. This is something that the directors’ of the business really wanted. I took a look at the Google marketplace and found MindMeister ($9 per user per month), a software package that I had already reviewed and was quite impressed by. Imagine my surprise when I found it in the Google marketplace!

The final piece of the puzzle that had me thinking hard about the solution was the relatively new incumbent within the ERP arena, MYERP vs the Salesforce platform and SalesForce.com’s AppExchange. After revisiting the requirements and the business budget, MYERP (First two users FREE followed by $29 per user per month) was an obvious choice for the short term. MYERP is an integrated suite with modules for CRM, Projects, Purchases, Accounting and Sales fully integrated with Google Apps. It is managed by an open source MySQL database with provision for API’s in the future to connect with other IT systems. Salesforce does, however, have some competent ERP solutions such as LessSoftware, Ascent and Glovia. As such, if in the future, Salesforce needs to be used for its CRM (Probably much better than MyERP’s CRM), ERP or development capabilities, Force.com could be utilised.

ISSUES ENCOUNTERED WITH GOOGLE APPS:

A few problems were encountered but no real show stoppers and the Google support team’s response was quite good. These calls were intentionally logged as low priority calls due to their low impact on users (No loss of productivity). Users had a few issues with being presented by different login/logout screens at different parts of the day. Users did not enjoy Google Apps inconsistentcy. For example, the business setup login/logout screen was configured to use the business logo and colour for login/logout but Google Apps still resorted to the default Google Apps logo and colours. While Google were searching for a solution, the tech team wanted to enable Single Sign On (SSO) to enable Google marketplace apps and as such chose MyOneLogin ($3 per user per month – Service termination from Feb 2012) that resolved the problem and the team closed the call.

There was a problem with enabling sub domain aliases and as such emails sent to joe.blogs@widgets.yourcompany.com were not being delivered and this took a while to resolve for various reasons, some beyond Google’s control.

For organisations and users accustomed to Microsoft (MS) Word, Google Docs may not be suitable. Certainly, I advised this business to purchase the MS Office Suite for its users to not only create a buy in for Google Apps but also to supply the users with a suite that they are very much accustomed to while Google Apps, plays catch-up. Google Apps has some interesting features, for example, the ability to share a document and the ability to edit it in almost real time (useful for meetings – exchanging ideas with your colleagues during the meeting), interesting form functionality and its gadgets features. The problem is that some functionality, that we take for granted within MS Word is simply quite cumbersome in Google Docs. For example, Print screen is used by everyone but to make it work in Google Docs, you would have to save the image in paint and then insert it as a .jpg etc.

There are various ways to use the Google Docs storage system up to a 1GB storage limit (only applies to non Google format documents – Max upload of 500KB – 10MB for .ppt – Possibly more for the future). The Max upload for word processed documents is a problem as it is so easy to create a document that exceeds, in today’s terms, this miniscule size. There are options and features to save the document in a Google format that:

The problem above brings me to my next workaround (or solution). From the Google marketplace, the team told me that they chose the Epicenter Document Management solution (1st user FREE , $9 per user per month) that allows 50GB of pooled storage. This created an accessible repository with role based permission policies, version control, online editing, document approvals, sharing features, text searching, detailed event logging and access auditing coupled with a single drag and drop feature for stored documents within Epicenter and Google Docs.

So, in summary, Google Apps and its marketplace constitute a competent suite of products for cloud computing (managed service/hosted solution). Salesforce is already tightly integrated with Google Apps and the Google marketplace (released 29th March 2010), is gathering momentum with innovative companies joining the Google realm. The next few years will decide the future of cloud computing and whether it will be accepted by larger and more established businesses. Google has firmly stuck a stake in the ground and is clearly betting on its cloud based solutions while attracting impressive solution providers through Salesforce and the Google marketplace. Microsoft, HP, IBM, Oracle, SAP and others are also positioning themselves for Cloud solutions. So, does every cloud have a silver lining?